Shares head for fifth straight daily rise

New Zealand Oil & Gas led gainers on the NZX 50 Index, rising for a second day on plans to buy back 2.2 percent of its stock, which the company says is 'significantly' below fair value. Securities market operator NZX paced the advance.

The NZX 50 climbed 10.39 points, or 0.3 percent, to 3153.53 as at midday, heading for its fifth straight increase. Wall Street was closed for the Labor Day holiday, so the local bourse got less of a steer from global equity markets. Shares gained in Europe.

NZ Oil & Gas climbed 4 percent to $1.29, the highest since July 15. The company will buy back up to 8.5 million shares between Sept. 10 and June 30 next year.

The current price "doesn’t reflect a reasonable current valuation of the company, even without taking into account the growth prospects," it said yesterday.

NZX gained 2.1 percent to $1.48. The exchange operator stemmed a slide in trading values and volumes last month, reporting a 21 percent gain to $1.76 billion in August from July, led by an increase in trading on its main board. Trading was still down 27 percent from the same month of 2009.

Pyne Gould Corp was unchanged at 43 cents after announcing that its Marac unit had adding Holden to its automotive finance books.

In the past two years, Marac has entered into relationships with Hyundai, Suzuki and Nissan, and a partnership with the Automobile Association. The Holden deal gives it access to about 30 percent of new car sales, according to Motor Industry Association July data.

Steel & Tube Holdings extended yesterday’s advance, gaining 1.3 percent to $2.40 on the prospect of increased sales of building materials as Canterbury rebuilds after last weekend’s earthquake.

Pike River Coal fell 2.8 percent to $1.05, the biggest decline on the NZX 50 today.

The kiwi dollar pared gains to a four-week high as investors wait for Wall Street to reopen after the Labor Day weekend brings America’s summer break to a close. The month of September is historically worse than the much-maligned October, which has witnessed several crashes, and traders are watching to see whether risk-sensitive assets can hold on to last week’s gains.

The currency recently traded at US72.08c from US72.36c yesterday. The NZ dollar may rise against its trans-Tasman compatriot today, with the Reserve Bank of Australia likely to keep interest rates on hold, while Labor draws closer to reaching an agreement to keep the governing benches. The kiwi was little changed at A78.82c from A78.96c yesterday.

Wholesale trade sales rose 2.2 percent, seasonally adjusted, in the second quarter, marking the third straight quarterly increase, according to Statistics New Zealand.

Primary product food rose 8.4 percent and unprocessed primary products gained 6.7 percent.

Strategic Finance has won a court ruling ordering Christchurch property developer Dave Henderson to pay almost $2.4 million to cover debt on a property development he bought from his friend the author Alan Duff, who had faced a mortgagee sale.

Justice Christine French said Henderson didn’t have a "tenable defence" as to whether he personally guaranteed the loan, according to the Aug. 16 judgement from the High Court in Christchurch.

- BusinessDesk